Tag Archives: Damages

Non-Practicing Entities at the USITC

Patent

By Dennis Crouch

RPX today published a study of the increase in non-practicing entity (NPE) activity at the United States International Trade Commission (ITC). The charts above (that come from the RPX article) show annual numbers for ITC investigations on behalf of NPE patent holders and the cumulative number of respondents (i.e., number of defendants). Both figures show a major increase in NPE activity at the ITC. In its study, RPX points-out that “[f]ully 25% of ITC Investigations in 2011 were filed by an NPE and 51% of respondents hauled into the ITC were in response to an NPE complaint.”

The ITC is an agency of the US Government not an Article III court. However, its administrative law judges conduct hearings that look an awful-lot like bench trials. I don’t have the data here, but the number of “investigations” is typically a subset of the total number of complaints filed. It takes votes from three of the six ITC Commissioners to begin an official investigation.

Why the new demand?: (1) In 2010, the ITC generously interpreted the “domestic industry” requirement and ruled that NPEs will ordinarily have standing to pursue a complaint. (2) Although the ITC does not award money damages, the ITC does typically issue injunctive relief since the agency is not bound by eBay v. MercExchange; (3) The ITC is not bound by the new joinder rules that limit the number of accused infringers per action; and (4) The ITC tends to move much more quickly than ordinary patent litigation.

Injunction for an NPE?: In the vast majority of NPE cases, the patent holder is actually seeking money and would receive no direct benefit from the accused infringer ceasing operations. However, despite being of no direct value to an NPE, injunctive relief is a major bargaining chip because of its value to the accused infringer. The ITC’s injunctions are only directed at imports, but most high-tech consumer products are imported and therefore qualify.

Money Damages: Money damages are not available at the ITC for either past or ongoing infringement. However, pursuing an action at the ITC does not foreclose an NPE patent holder from also filing a complaint in a federal district court seeking monetary damages. In this sense, ITC litigation should likely be seen as an additional potential battle-front that may be fought in conjunction with district court litigation; reexamination (and future review) processes at the USPTO; and non-US patent litigation as well.

RPX: I should note here the source of this data is RPX – a company that has built its business on making NPEs appear to be the “bad guys.” RPX is currently defending its market-shaping activities in an antitrust lawsuit filed earlier this month. Although I believe the data presented here is correct, an anti-NPE bent is apparent from the text of the study.

Notes

 

Federal Circuit Limits Intervening Rights to Cases involving Textual Claim Amendments

Patent, ,

By Dennis Crouch

Marine Polymer Tech. v. Hemcon (Fed. Cir. 2012) (en banc)

In a fractured en banc decision, the Federal Circuit has held that statutory the intervening rights defense only arises when the text of claims are amended or new claims added during a post grant proceeding. In this case, the claim scope had been arguably changed under Phillips v. AWH based upon arguments made during a reexamination, but the text of the claims had not been amended. Following this decision, the accused infringers cannot claim intervening rights in this situation.

[T]he plain directive of the governing statute before us does not permit HemCon to invoke intervening rights against claims that the PTO confirmed on reexamination to be patentable as originally issued. To be sure, patent applicants’ actions and arguments during prosecution, including prosecution in a reexamination proceeding, can affect the proper interpretation and effective scope of their claims. But in rejecting HemCon’s request for intervening rights, we are not here interpreting claims. Rather, we are interpreting a statute that provides for intervening rights following reexamination only as to “amended or new” claims. The asserted claims of the ‘245 patent are neither.

As part of its ruling, the court noted its perspective that the PTO on reexamination is unlikely to consider a patent claim to be narrowed simply based arguments made by the patentee:

If, in reexamination, an examiner determines that particular claims are invalid and need amendment to be allowable, one would expect an examiner to require amendment rather than accept argument alone.

The doctrine of intervening rights is derived from the Patent Act, which indicates that, following a reexamination, a patentee cannot claim damages for pre-reexamination infringement if the resulting claims were in “amended form” and not “substantially identical” to the original claims. 35 U.S.C. §§ 252 and 307(b).

The dissent argued that any change to the scope of a claim during prosecution should be interpreted as an amendment and that, therefore, arguments and statements by the patentee that would result in a modified claim construction

Split Decision: Only ten of the Federal Circuit judges participated in the decision. Thus, a majority needed at least six votes. As it turns out, only a portion of the majority opinion received six votes. The entire majority opinion was written by Judge Lourie and joined by four other judges: Chief Judge Rader and Judges Newman, Bryson, and Prost. The first half of the majority opinion discussed claim construction issues and the second part discussed the intervening rights defense. Judge Linn brought the final vote for the majority, but Judge Linn only agreed to the portion of the opinion focusing on intervening rights. Judge Dyk wrote in dissent and the entire opinion was joined by Judges Gajarsa, Reyna, and Wallach. In parallel fashion, the dissent first discussed claim construction and then discussed intervening rights. Judge Linn joined the claim construction portion of the dissent but not the intervening rights portion. Thus, in the final tally, claim construction was split 5-5 and intervening rights issues was divided 6-4.

Notes:

Patently-O Bits & Bytes by Lawrence Higgins

Patent, , ,

Is There a Trend Towards IP Litigation Boutiques?

  • On February 29th of this year Renee Quinn of IPWatchdog wrote a post titled, Boutique Rising: A Conversation with Winthrop & Weinstine, in which she discusses the increase in IP litigation boutiques. [Link] I recently spoke with attorney Jason Mudd of the newly formed IP law firm Erise IP (www.eriseip.com) about the trend towards IP litigation boutiques. Jason recently left a large Kansas City law firm, along with partners Eric Buresh and Adam Seitz, to start Erise IP with a team of attorneys from their prior firm. Erise IP brought along several large clients, including Garmin, Sony, Ubisoft, Ford, and Mazda, to name a few. Jason believes their new firm is consistent with a trend of IP litigation groups departing large law firms to form boutique firms that are able to provide clients with greater flexibility demanded by the rapidly changing IP litigation landscape. While the numbers are not out yet, there could possibly be a recent trend towards IP litigation boutiques.

Copyright Infringement

  • Last week while I was in copyright class, Professor Crouch brought up the Lexis-Nexis and Westlaw class action copyright infringement case. The plaintiffs in the case claim that the defendants (Lexis and Westlaw) copied thousands of copyright-protected works created by, and owned by, the attorneys and law firms who authored them. So, this case got me thinking, do companies like Google Patents infringe patent lawyers and patent firms copyrights? Similar to Westlaw and Lexis, Google downloads thousands of patent applications to store in their database. While there is not a clear answer on whether patent applications are copyrightable or not, it seems that patent applications can have parts covered by copyright –drawings for example, even if the entire patent application is not copyrightable. In Rozenblat v. Sandia Corp. 69 USPQ2d 1474 (7th Cir 2003), the 7th Circuit recognized the copyrightability of an inventor's patent drawings. Does, this case alone indicate that Google and others may be guilty of copyright infringement for downloading patent applications? [Link]
  • It should be noted that Google is distinguishable from Lexis and Westlaw because Google does not charge users directly, and this fact adds weight to their fair use argument.

Patent Searching Tool

  • ArchPatent, a free-to-use patent search resource which provides novel ways to search, sort, and view patent information, has launched a revamped website this week. The revamp drew its inspiration from beta feedback over the last five months from individuals within the IP industry. ArchPatent Founder Brad Chassee indicates that the objective with the revamp is to focus the site on providing the simplest, most intuitive USPTO search tool – one which experts enjoy using and one which those new to patent searching would actually be able to navigate. ArchPatent wants everyone to be able to "slice and dice" patent search results quickly and efficiently, which should drastically reduce search times and simplify complex search tasks. The site is now ad free with some additional functionality being developed as part of a soon-to-be-released premium offering. The site has a useful filtering tool and filter types include: classification, assignee, examiner, agent, applicant and most referenced. The site now provides access to searchable USPTO data back to 1920 and pdfs back to 1790. [Link]

Patent Jobs:

  • Buchanan Ingersoll & Rooney is seeking an Electrical patent agent with a minimum of 3 years of experience and a degree in EE, CS or Computer engineering to work in their Alexandria, VA office. [Link]
  • Stoel Rives is searching for a patent attorney with 3-5 years of experience drafting electrical-related patent applications to work in their Portland or Seattle office. [Link]
  • Buchanan Ingersoll & Rooney is seeking an Electrical patent associate with a minimum of 3 years of experience and a degree in EE, CS or Computer engineering to work in their Alexandria, VA office. [Link]
  • SAS is looking for a patent counsel with 3 years of patent prep and prosecution experience in the software field and a degree in EE or CS to work at their Cary, NC location. [Link]
  • Sterne, Kessler, Goldstein & Fox is seeking chemist patent attorneys with at least a master's degree in organic or medicinal chemistry to work in their DC office. [Link]
  • Sterne, Kessler, Goldstein & Fox is searching for a chemical or biochemical IP attorney with a degree in CE, BM, or ME and 1-3 years of experience to work in their DC office. [Link]
  • Millennium Inorganic Chemicals is looking for corporate counsel with a degree in chemistry or chemical engineering and 7+ years of experience to work at their Glen Burnie, MD location. [Link]
  • Rutan & Tucker is seeking a trademark clerk with a minimum of 1 year of IP docket & filing experience to work at their Costa Mesa, CA office. [Link]
  • Westerman, Hattori, Daniels & Adrian is searching for a chemical IP attorney/agent with a 3 years or less of experience to work at their DC office. [Link]
  • Cantor Colburn is looking for an associate patent attorney with a chemical engineering degree and 2-5 years of experience to work in one of their offices. [Link]
  • Roberts Mlotkowski Safran & Cole is seeking a patent attorney with 2-4 years of experience and a degree in EE to work in their McLean, VA office. [Link]

Upcoming Events:

  • LES (USA & Canada) 2012 Winter Meeting will be held March 12-14 in Anaheim, CA. The meeting will focus on cutting-edge issues in the high tech space with overlapping content in related industries, including clean tech, nanotech, and medical devices. Featured speakers include Honorable Randall Rader, Chief Judge, U.S. Court of Appeals for the Federal Circuit; Catherine Casserly, CEO, Creative Commons; and Patrick Ennis, Head of Global Technology, Intellectual Ventures. Patently-O readers save $100 with code PO1. [Link]
  • The New Jersey Intellectual Property Law Association will hold a half-day Patent Litigation Seminar on Wednesday, March 14, 2012 11:45 am to 5:45 pm. Guest speakers include: Paul Berghoff, Kara Stoll, William McElwain, Richard Bress, Barbara Fiacco, and Lewis Ho. [Link]
  • C5's 22 Forum on Biotech Patenting conference will take place March 14-15 in Munich, Germany. The conference brings together experienced in-house counsel from both innovator and generic pharma and biotech companies and their expert legal advisors from various jurisdictions across the globe. Session will cover the patentability of gene sequence patents in Europe and the US, current developments on biotech products and patent considerations for bio-deposits, and many other sessions. (Patently-O readers register with PO 10 for a discount). [Link]
  • The 14th Annual Richard C. Sughrue Symposium on IP Law and Policy will be held March 19th at The University of Akron Law School. The program will include a review of recent developments in patent, trademark, and copyright law, as well as a panel discussion on international IP. David Kappos will be the featured speaker and he will discuss the USPTO's implementation of the American Invents Act. Other guest speakers include: Timothy Holbrook, Mark Janis, former chief judge Paul Michel, Samuel Oddi, Ryan Vacca, Susan Pan, Harold Wegner, and many others.
  • American Conference Institute's FDA Boot Camp conference is scheduled for March 20-21 in New York, NY. ACI's FDA Boot Camp has been designed to give products or patent litigators, as well as patent prosecutors, industry in-house counsel, and life sciences investment and securities experts, a strong working knowledge of core FDA competencies. (Patently-O readers register with PO 200 for a discount). [Link]
  • Fitch, Even, Tabin & Flannery LLP will present a free one-hour CLE webinar, "Provisional Patent Applications: Making Substance in a Land Without Form," on March 21, 2012 at 12 noon EST. The first-to-invent impact of the America Invents Act requires a serious reevaluation of the use and content of provisional patent applications. Stephen G. Parmelee will address approaches to leveraging the provisional patent application opportunity by encouraging the inclusion of substantive content while taking economic advantage of the stylistic freedom that provisional filings permit. [Link]
  • The University of Pittsburgh School of Law will have their annual Innovation Law Lecture on March 22, 2012, 4-5PM. This year's guest speaker will be Professor Rochelle Dreyfuss from NYU School of Law and her talk is entitled "Are Patents Good for Science?" The event is open to the general public and one (1) CLE credit has been requested for the lecture. [Link] [Link]
  • American Conference Institute's PTO Procedures Under the America Invents Act conference is scheduled for March 26-27 in New York, NY. This conference will serve as a practical and tactical guide for PTO practice post-Patent Reform. (Patently-O readers register with PO 200 for a discount). [Link]
  • Managing Intellectual Property is holdings its US Patent Reform Forum conference March 27, 2012 in Washington D.C. The forum will bring together top officials, leading counsel at US corporations and their private practice advisers for a number of lively and informative sessions looking at the strategic implications of US Patent Reform. Speakers include: David Kappos, Judge Paul Michel, Gene Quinn, Robert Armitage, Phil Johnson, and many others. (Patently-O readers will receive a discount and in-house IP counsel from large corporations and research institutes attend free of charge.) [Link]
  • The ABA Section of IP Law will hold its 27th Annual IP Law Conference March 28-30 in Arlington, VA. The conference is recognized for its national and international scope and preeminent programming. It attracts IP practitioners from across the nation and around the world. Speakers and moderators include: Sharon Marsh, Keisha Hylton-Rodic, Alexander Wilson, Steven Emmert, Teresa Rea, James Bikoff, David Kappos, and many others. The discounted early registration deadline is March 14. [Link] [Link]
  • AIPLA and The University of San Diego School of Law will host the 2012 Electronic & Computer Patent Law Summit on April 2nd. The summit will include in-house counsel from Qualcomm, Apple, SAP, Covidien, ViaSat, Google, and Cisco, among others, as well as a distinguished panel of US District Court judges. Topics will include the new First to File system, an update on divided infringement, how the patent portfolio use and acquisition landscape is changing, and a discussion of the patent pilot program. [Link]
  • On April 10th join the United States Patent and Trademark Office Managers, Design Examiners, Design Patent Practitioners and Industrial Designers from across the country in a lively and thought-provoking discussion at the USPTO. They will discuss rules and techniques relating to proper graphic descriptions of design patent claims, confer on best practices aimed at the broadest protection of industrial designs in the United States, and hear from members of the design community on the importance of strong industrial design protection in an increasingly design-conscious world. [Link]
  • The IP Section of the Atlanta Bar Association and Georgia State University Law School will hold its 8th annual SpringPosium at the Barnsley Gardens resort on April 13 &14. Some example seminars will include: the new America Invents Act, Federal Court best practices, IP law and life practice management, and recent developments in damages law. Guest speakers include: Clerk of Court and Chief Deputy Clerk of the US Court of Appeals for the Federal Circuit, Jan Horbaly and Pamela Twiford and Clerk of Court of the US District Court for the North District of Georgia, James Hatten.
  • The European Generic Medicines Association is hosting the 10th EGA International Symposium regarding Biosimilar Medicines on April 19-20 in London. Greenblum & Bernstein is providing a pre-symposium workshop on April 19, 2012 titled: Biosimilars In America: IP Strategy and Due Diligence. The workshop will explore the mechanics of the Biologics Act with an emphasis on how the Act relates to the involved intellectual property and how the intellectual property may impact the biosimilar applicant's strategy for entering the market. [Link]
  • ACI will hold its 6th Annual Paragraph IV Disputes conference on April 24-25 in New York City. The conference will cover topics such as: the impact of the AIA on Hatch-Waxman litigation, claim construction, prior art obviousness and obvious-type double patenting, and many other topics. (Patently-O readers register with PO 200 for a discount). [Link]
  • The World Research Group is holding its 4th Annual Corporate IP Counsel Forum on May 16-17 in NYC. The Corporate IP Counsel Forum will address key issues and uncover latest developments related to IP in the form of case studies and panel discussions. Some of the topics include, but are not limited to: The America Invents Act and its impact on patent litigation and prosecution, IP monetization strategies for small and mid-size companies, Patent valuation, The top 10 most influential court cases in IP this year, Patent eligibility, Invention mining, Divided infringement, Best practices for combating non-practicing entities, Appeals to the U.S. Court of Appeals for the Federal Circuit, Copyright infringement. [Link]
  • The Annual DRI Business Litigation and Intellectual Property Seminar will be held May 16-18, 2012, in New York City. Attendees will learn trial and appellate advocacy skills in business litigation get up-to-date on the last trends in intellectual property and business litigation, and network with in-house counsel, business and intellectual property trial lawyers and experts from across the country. Speakers include: Former ABA President, Dennis W. Archer, Dennis Archer PLLC, and David Leitch, VP and General Counsel of Ford Motor Company. [Link]
  • The San Francisco Intellectual Property Law Association is hosting its annual seminar in Healdsburg, the center of one of California's best wine regions, from June 1-3. Speakers include Hon. Margaret A. (Peggy) Focarino, USPTO Commissioner of Patents, Hon. Robert Stoll, former USPTO Commissioner of Patents, Hon. Gerard F. Rogers, Chief Administrative Trademark Judge of the TTAB, Hon. Randy R. Rader, Chief Judge of Federal Circuit, Hon. Susan Illston, Judge of N.D.CA, Hon. Edward J. Davila, Judge of N.D.CA, as well as professors and leading practitioners. [Link]

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

Patently-O Bits & Bytes by Lawrence Higgins

Patent, , ,

Is There a Trend Towards IP Litigation Boutiques?

  • On February 29th of this year Renee Quinn of IPWatchdog wrote a post titled, Boutique Rising: A Conversation with Winthrop & Weinstine, in which she discusses the increase in IP litigation boutiques. [Link] I recently spoke with attorney Jason Mudd of the newly formed IP law firm Erise IP (www.eriseip.com) about the trend towards IP litigation boutiques. Jason recently left a large Kansas City law firm, along with partners Eric Buresh and Adam Seitz, to start Erise IP with a team of attorneys from their prior firm. Erise IP brought along several large clients, including Garmin, Sony, Ubisoft, Ford, and Mazda, to name a few. Jason believes their new firm is consistent with a trend of IP litigation groups departing large law firms to form boutique firms that are able to provide clients with greater flexibility demanded by the rapidly changing IP litigation landscape. While the numbers are not out yet, there could possibly be a recent trend towards IP litigation boutiques.

Copyright Infringement

  • Last week while I was in copyright class, Professor Crouch brought up the Lexis-Nexis and Westlaw class action copyright infringement case. The plaintiffs in the case claim that the defendants (Lexis and Westlaw) copied thousands of copyright-protected works created by, and owned by, the attorneys and law firms who authored them. So, this case got me thinking, do companies like Google Patents infringe patent lawyers and patent firms copyrights? Similar to Westlaw and Lexis, Google downloads thousands of patent applications to store in their database. While there is not a clear answer on whether patent applications are copyrightable or not, it seems that patent applications can have parts covered by copyright –drawings for example, even if the entire patent application is not copyrightable. In Rozenblat v. Sandia Corp. 69 USPQ2d 1474 (7th Cir 2003), the 7th Circuit recognized the copyrightability of an inventor's patent drawings. Does, this case alone indicate that Google and others may be guilty of copyright infringement for downloading patent applications? [Link]
  • It should be noted that Google is distinguishable from Lexis and Westlaw because Google does not charge users directly, and this fact adds weight to their fair use argument.

Patent Searching Tool

  • ArchPatent, a free-to-use patent search resource which provides novel ways to search, sort, and view patent information, has launched a revamped website this week. The revamp drew its inspiration from beta feedback over the last five months from individuals within the IP industry. ArchPatent Founder Brad Chassee indicates that the objective with the revamp is to focus the site on providing the simplest, most intuitive USPTO search tool – one which experts enjoy using and one which those new to patent searching would actually be able to navigate. ArchPatent wants everyone to be able to "slice and dice" patent search results quickly and efficiently, which should drastically reduce search times and simplify complex search tasks. The site is now ad free with some additional functionality being developed as part of a soon-to-be-released premium offering. The site has a useful filtering tool and filter types include: classification, assignee, examiner, agent, applicant and most referenced. The site now provides access to searchable USPTO data back to 1920 and pdfs back to 1790. [Link]

Patent Jobs:

  • Buchanan Ingersoll & Rooney is seeking an Electrical patent agent with a minimum of 3 years of experience and a degree in EE, CS or Computer engineering to work in their Alexandria, VA office. [Link]
  • Stoel Rives is searching for a patent attorney with 3-5 years of experience drafting electrical-related patent applications to work in their Portland or Seattle office. [Link]
  • Buchanan Ingersoll & Rooney is seeking an Electrical patent associate with a minimum of 3 years of experience and a degree in EE, CS or Computer engineering to work in their Alexandria, VA office. [Link]
  • SAS is looking for a patent counsel with 3 years of patent prep and prosecution experience in the software field and a degree in EE or CS to work at their Cary, NC location. [Link]
  • Sterne, Kessler, Goldstein & Fox is seeking chemist patent attorneys with at least a master's degree in organic or medicinal chemistry to work in their DC office. [Link]
  • Sterne, Kessler, Goldstein & Fox is searching for a chemical or biochemical IP attorney with a degree in CE, BM, or ME and 1-3 years of experience to work in their DC office. [Link]
  • Millennium Inorganic Chemicals is looking for corporate counsel with a degree in chemistry or chemical engineering and 7+ years of experience to work at their Glen Burnie, MD location. [Link]
  • Rutan & Tucker is seeking a trademark clerk with a minimum of 1 year of IP docket & filing experience to work at their Costa Mesa, CA office. [Link]
  • Westerman, Hattori, Daniels & Adrian is searching for a chemical IP attorney/agent with a 3 years or less of experience to work at their DC office. [Link]
  • Cantor Colburn is looking for an associate patent attorney with a chemical engineering degree and 2-5 years of experience to work in one of their offices. [Link]
  • Roberts Mlotkowski Safran & Cole is seeking a patent attorney with 2-4 years of experience and a degree in EE to work in their McLean, VA office. [Link]

Upcoming Events:

  • LES (USA & Canada) 2012 Winter Meeting will be held March 12-14 in Anaheim, CA. The meeting will focus on cutting-edge issues in the high tech space with overlapping content in related industries, including clean tech, nanotech, and medical devices. Featured speakers include Honorable Randall Rader, Chief Judge, U.S. Court of Appeals for the Federal Circuit; Catherine Casserly, CEO, Creative Commons; and Patrick Ennis, Head of Global Technology, Intellectual Ventures. Patently-O readers save $100 with code PO1. [Link]
  • The New Jersey Intellectual Property Law Association will hold a half-day Patent Litigation Seminar on Wednesday, March 14, 2012 11:45 am to 5:45 pm. Guest speakers include: Paul Berghoff, Kara Stoll, William McElwain, Richard Bress, Barbara Fiacco, and Lewis Ho. [Link]
  • C5's 22 Forum on Biotech Patenting conference will take place March 14-15 in Munich, Germany. The conference brings together experienced in-house counsel from both innovator and generic pharma and biotech companies and their expert legal advisors from various jurisdictions across the globe. Session will cover the patentability of gene sequence patents in Europe and the US, current developments on biotech products and patent considerations for bio-deposits, and many other sessions. (Patently-O readers register with PO 10 for a discount). [Link]
  • The 14th Annual Richard C. Sughrue Symposium on IP Law and Policy will be held March 19th at The University of Akron Law School. The program will include a review of recent developments in patent, trademark, and copyright law, as well as a panel discussion on international IP. David Kappos will be the featured speaker and he will discuss the USPTO's implementation of the American Invents Act. Other guest speakers include: Timothy Holbrook, Mark Janis, former chief judge Paul Michel, Samuel Oddi, Ryan Vacca, Susan Pan, Harold Wegner, and many others.
  • American Conference Institute's FDA Boot Camp conference is scheduled for March 20-21 in New York, NY. ACI's FDA Boot Camp has been designed to give products or patent litigators, as well as patent prosecutors, industry in-house counsel, and life sciences investment and securities experts, a strong working knowledge of core FDA competencies. (Patently-O readers register with PO 200 for a discount). [Link]
  • Fitch, Even, Tabin & Flannery LLP will present a free one-hour CLE webinar, "Provisional Patent Applications: Making Substance in a Land Without Form," on March 21, 2012 at 12 noon EST. The first-to-invent impact of the America Invents Act requires a serious reevaluation of the use and content of provisional patent applications. Stephen G. Parmelee will address approaches to leveraging the provisional patent application opportunity by encouraging the inclusion of substantive content while taking economic advantage of the stylistic freedom that provisional filings permit. [Link]
  • The University of Pittsburgh School of Law will have their annual Innovation Law Lecture on March 22, 2012, 4-5PM. This year's guest speaker will be Professor Rochelle Dreyfuss from NYU School of Law and her talk is entitled "Are Patents Good for Science?" The event is open to the general public and one (1) CLE credit has been requested for the lecture. [Link] [Link]
  • American Conference Institute's PTO Procedures Under the America Invents Act conference is scheduled for March 26-27 in New York, NY. This conference will serve as a practical and tactical guide for PTO practice post-Patent Reform. (Patently-O readers register with PO 200 for a discount). [Link]
  • Managing Intellectual Property is holdings its US Patent Reform Forum conference March 27, 2012 in Washington D.C. The forum will bring together top officials, leading counsel at US corporations and their private practice advisers for a number of lively and informative sessions looking at the strategic implications of US Patent Reform. Speakers include: David Kappos, Judge Paul Michel, Gene Quinn, Robert Armitage, Phil Johnson, and many others. (Patently-O readers will receive a discount and in-house IP counsel from large corporations and research institutes attend free of charge.) [Link]
  • The ABA Section of IP Law will hold its 27th Annual IP Law Conference March 28-30 in Arlington, VA. The conference is recognized for its national and international scope and preeminent programming. It attracts IP practitioners from across the nation and around the world. Speakers and moderators include: Sharon Marsh, Keisha Hylton-Rodic, Alexander Wilson, Steven Emmert, Teresa Rea, James Bikoff, David Kappos, and many others. The discounted early registration deadline is March 14. [Link] [Link]
  • AIPLA and The University of San Diego School of Law will host the 2012 Electronic & Computer Patent Law Summit on April 2nd. The summit will include in-house counsel from Qualcomm, Apple, SAP, Covidien, ViaSat, Google, and Cisco, among others, as well as a distinguished panel of US District Court judges. Topics will include the new First to File system, an update on divided infringement, how the patent portfolio use and acquisition landscape is changing, and a discussion of the patent pilot program. [Link]
  • On April 10th join the United States Patent and Trademark Office Managers, Design Examiners, Design Patent Practitioners and Industrial Designers from across the country in a lively and thought-provoking discussion at the USPTO. They will discuss rules and techniques relating to proper graphic descriptions of design patent claims, confer on best practices aimed at the broadest protection of industrial designs in the United States, and hear from members of the design community on the importance of strong industrial design protection in an increasingly design-conscious world. [Link]
  • The IP Section of the Atlanta Bar Association and Georgia State University Law School will hold its 8th annual SpringPosium at the Barnsley Gardens resort on April 13 &14. Some example seminars will include: the new America Invents Act, Federal Court best practices, IP law and life practice management, and recent developments in damages law. Guest speakers include: Clerk of Court and Chief Deputy Clerk of the US Court of Appeals for the Federal Circuit, Jan Horbaly and Pamela Twiford and Clerk of Court of the US District Court for the North District of Georgia, James Hatten.
  • The European Generic Medicines Association is hosting the 10th EGA International Symposium regarding Biosimilar Medicines on April 19-20 in London. Greenblum & Bernstein is providing a pre-symposium workshop on April 19, 2012 titled: Biosimilars In America: IP Strategy and Due Diligence. The workshop will explore the mechanics of the Biologics Act with an emphasis on how the Act relates to the involved intellectual property and how the intellectual property may impact the biosimilar applicant's strategy for entering the market. [Link]
  • ACI will hold its 6th Annual Paragraph IV Disputes conference on April 24-25 in New York City. The conference will cover topics such as: the impact of the AIA on Hatch-Waxman litigation, claim construction, prior art obviousness and obvious-type double patenting, and many other topics. (Patently-O readers register with PO 200 for a discount). [Link]
  • The World Research Group is holding its 4th Annual Corporate IP Counsel Forum on May 16-17 in NYC. The Corporate IP Counsel Forum will address key issues and uncover latest developments related to IP in the form of case studies and panel discussions. Some of the topics include, but are not limited to: The America Invents Act and its impact on patent litigation and prosecution, IP monetization strategies for small and mid-size companies, Patent valuation, The top 10 most influential court cases in IP this year, Patent eligibility, Invention mining, Divided infringement, Best practices for combating non-practicing entities, Appeals to the U.S. Court of Appeals for the Federal Circuit, Copyright infringement. [Link]
  • The Annual DRI Business Litigation and Intellectual Property Seminar will be held May 16-18, 2012, in New York City. Attendees will learn trial and appellate advocacy skills in business litigation get up-to-date on the last trends in intellectual property and business litigation, and network with in-house counsel, business and intellectual property trial lawyers and experts from across the country. Speakers include: Former ABA President, Dennis W. Archer, Dennis Archer PLLC, and David Leitch, VP and General Counsel of Ford Motor Company. [Link]
  • The San Francisco Intellectual Property Law Association is hosting its annual seminar in Healdsburg, the center of one of California's best wine regions, from June 1-3. Speakers include Hon. Margaret A. (Peggy) Focarino, USPTO Commissioner of Patents, Hon. Robert Stoll, former USPTO Commissioner of Patents, Hon. Gerard F. Rogers, Chief Administrative Trademark Judge of the TTAB, Hon. Randy R. Rader, Chief Judge of Federal Circuit, Hon. Susan Illston, Judge of N.D.CA, Hon. Edward J. Davila, Judge of N.D.CA, as well as professors and leading practitioners. [Link]

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

Microsoft and Nokia sue Apple for Patent Infringement (via a Holding Company)

Patent,

by Dennis Crouch

Luxembourg based Core Wireless Licensing S.a.r.l. has sued Apple for patent infringement in the Eastern District of Texas. The recently filed complaint alleges that Apple’s communication devices such as iPads and iPhones infringe eight different Core Wireless patents.  The Core Wireless family of patents focus primarily on communication protocols and the patent owner claims that the patents are infringed by any device that communicates using 2G, 3G, or 4G standards.

Core Wireless obtained its portfolio of 2,000 patents and pending applications from Nokia and (apparently) Microsoft. In 2011, the patent licensing entity MOSAID purchased Core Wireless.  MOSAID itself is owned by the US private equity firm Sterling Partners.

The reported purchase price for Core Wireless (including its patents) was just under $20,000 — seemingly a very low price.  However, there is a kicker, the sale requires that the new owner enforce the patents and 2/3 of any licensing revenue must be sent to Microsoft and Nokia. Further, the patent ownership rights are subject to a condition subsequent — if Core Wireless fails to meet minimum performance thresholds then the patent rights revert to the grantors (Nokia and Microsoft). The following comes from a 2011 press release by MOSAID:

Core Wireless will retain approximately one-third of gross royalties from future licensing and enforcement of the patents and will bear all of the costs associated with their administration, licensing, enforcement and monetization. Core Wireless’ ongoing ownership of the portfolio is subject to minimum future royalty milestones. The remaining 2/3 of gross royalties will be paid to Nokia and Microsoft Corporation (NASDAQ: MSFT).

One way to look at this is that MOSAID is essentially working as on a property management contract. With patents, title must shift in order to facilitate the necessary lawsuits. The complaint lists the following patents as infringed: 6,792,277, 7,606,910, 6,697,347, 7,447,181, 6,788,959, 7,529,271, 6,266,321, 6,978,143.

This case is also interesting in the context of Professor Schwartz’s article on Contingent Fee Patent Litigation.  In a round-about way, Nokia and Microsoft have hired MOSAID on contingency fee to enforce their patent rights.  The complaint itself was filed by Henry Bunsow of Dewey Leboeuf in San Francisco with Johnny Ward Jr. serving as local counsel in E.D. Texas. True to its role as hopeful licensor, the plaintiff has only asked for money damages and not injunctive relief to stop ongoing infringement.

Google Buys More Patents: Last fall, MOSAID sold a set of 18 patents and patent applications to Google for a reported $11 million. Recently, the pair recorded a new transaction of about 200 patents and applications from MOSAID to Google.  Those patents were previously owned by the Italian tire manufacturer Pirelli and a spinoff company PGT-Photonics.  Google also recently purchased one eCommerce patent from the tiny firm Alpine-in-Motion.

GE Wins Wind Turbine Patent Appeal – USITC Must Now Determine Whether to Block Mitsubishi Wind Turbine Imports

Patent, ,

GE v.USITC and Mitsubishi (Fed. Cir. 2012)

Wind turbine technology is coming into its own. GE and Mitsubishi are both global leaders. Mitsubishi imports wind turbines into the US, and GE filed a complaint with the US International Trade Commission (USITC) alleging infringement of three patents. Patent Nos. 7,321,221, 6,921,985, and 5,083,039. The '039 patent expired in 2011 and, because the USITC's only remedy is injunctive relief to stop ongoing and future infringement, the court has dismissed all charges associated with that expired patent.

During its proceedings, the USITC Administrative Law Judge found the GE patents infringed, enforceable, and "not invalid." However, patents are only enforceable at the USITC if there is a "domestic industry" for the claimed invention. 19 U.S.C. § 1337(a). The statute specifically requires a US industry that can show "with respect to articles protected by the patent" significant investment in plant and equipment; employment; or investment in exploitation, "including engineering, research and development, or licensing." The ALJ found a domestic industry, but the full Commission rejected that finding and additionally held that Mitsubishi did not infringe the '221 patent.

Win for GE: In a decision penned by Judge Newman and joined by Chief Judge Rader and Judge Linn, the Federal Circuit has affirmed-in-part, vacated-in-part, reversed-in-part, and remanded. Overall, this is a win for GE because the appellate court ruled that a domestic industry exists in relation to the '985 patent and it appears that the USITC already agrees that the '985 patent is valid and infringed.

USITC Domestic industry jurisprudence is a mess. Here, the basic question boiled down to whether there is at least one claim – GE's wind turbines are would infringe the claims in its asserted patents. That decision obviously turned on claim construction and particularly whether GE's domestic turbines included a "converter controller coupled with the inverter … to shunt current from the inverter." The problem with GE's domestic turbines is that its controller is within the inverter and the Commission held that it could not therefore be "coupled to" or shunt current "from" the inverter. On appeal, the court rejected that analysis and instead held that the claim does not require that the controller be separate from the inverter.

A similar argument was rejected in NTP, Inc. v. Research in Motion, Ltd., 418 F.3d 1282 (Fed. Cir. 2005), where some of the claims recited a receiver "connected to" or "coupled to" a processor or that the receiver "transfers" information to the processor. The accused infringer in NTP had argued that "connected to," "coupled to," and "transfer from" each requires the receiver and the processor to be separate, but the court concluded that "the two components could be connected, joined, or linked together by wires or other electrical conductors and still be located in the same housing or even on the same circuit board." 418 F.3d at 1310-11. The court also held that the function that information is transferred between two entities does not require physical separation of the entities. Id. at 1310.

Based upon its corrected claim construction, the Federal Circuit was able to conclude that claim 15 of the '985 patent "covers the domestic industry turbines" and that GE therefore has a right to bring an action on the patent in the ITC.

Notes:

  • GE filed a parallel lawsuit requesting damages and injunctive relief against Mitsubishi in the Southern District of Texas That case has been stayed pending the outcome of the ITC action. In a separate case, GE is fighting with one of its former employees — Thomas Wilkins who is claiming joint inventorship rights to the patents. Wilkins has apparently assigned his rights to Mistubishi.

Patently-O Bits & Bytes by Lawrence Higgins

Patent, ,

Conference on Industry/Academic Collaborations: Lessons from the Trenches

  • Innovation remains a major driver of economic growth in this country, and research universities provide a key reservoir of innovation. Increasingly, universities and industry have joined forces to translate that potential into jobs and commercial industries. Designing the complex legal and business frameworks for these collaborations is an evolving art, which will be discussed by those at the forefront of these transactions. On February 29, at UC Hastings College of Law, individuals from some of the biggest companies in the world will discuss their relationships with Universities. Google, Hoffman-LaRoche, Intel, Pfizer and BP will speak about their collaborations. The Keynote Speaker will be Chris Vein, The White House Office of Science and Technology Policy. Guest speakers include: Robin Feldman, Susan Capello, Paul Willems, Louisa Daniels, Jeff Walz, Laura Berner, and many others. This event will also be streamed online for individuals who are unable to attend. [Link]

Federal Court Dismisses OSGATA Lawsuit

  • The OSGATA suit against Monsanto has been dismissed by the US District Court for the Southern District of NY. OSGATA claimed that they did not want or intend to grow crops containing Monsanto patented gene traits and they feared being sued by Monsanto. Judge Naomi Buchwald noted that, Monsanto averages about 13 patent infringement lawsuits targeted towards farmers per year, which is considered insignificant compared to the number of farms in the US. The court held that there was no case or controversy because Monsanto has yet to take action against any of the plaintiffs. [Link]

USPTO Detroit Office Update

  • The Elijah J. McCoy United States Patent and Trademark Office (USPTO) will open in Detroit, Michigan in July 2012. The USPTO plans to hire for more than 100 positions, including patent examiners and Board of Patent Appeals and Interferences judges. The USPTO hopes to fill more than 50 percent of the positions by the end of the summer. Vacancy announcements for patent examiner positions and judges have been posted on the USA Jobs website.

Student Writing Contest

  • The Pennsylvania Bar Association IP Law Section is accepting papers for its annual IP writing contest. The competition is open to all students enrolled in one of the Pennsylvania law schools and Pennsylvania residents enrolled at other law schools within the US. The first place winner will receive $2500 and the paper will be published. [Link]

Patent Jobs:

  • Banner & Witcoff is seeking an International IP Manager with a minimum of 10 years of experience in management to work in their DC or Chicago office. [Link]
  • Axiom is looking to hire patent attorneys with 7+ years of experience to work remotely. [Link]
  • Sterne, Kessler, Goldstein & Fox is looking for electrical IP attorneys with 1-4 years of experience to work in their DC office. [Link]
  • Hiscock & Barclay is seeking patent attorneys/agents with a minimum of 3-5 years of experience to work at their Syracuse & Rochester offices. [Link]
  • The Coca-Cola Company is searching for a patent agent with 2-4 years of experience to work at their Atlanta location. [Link]
  • The USPTO is looking for patent examiners with a BS degree in engineering to work at their Alexandra location. [Link]
  • Steptoe & Johnson is seeking IP associates with a minimum of 4 years of experience in IP litigation to work in their DC office. [Link]
  • Fish & Richardson is looking for technical advisors with a background in EE, physics, or CS to work at one of their several offices. [Link]
  • Klemchuk Kubasta is searching for a patent associate with at least 4 years of experience to work in their Dallas office. [Link]
  • Guntin Meles & Gust is seeking patent attorneys with 3+ years of experience and a degree in EE or Computer Engineering to work in their Chicago office. [Link]
  • Levine Bagade Han is looking for a patent associate with 2-6 years of experience to work in their Palo Alto office. [Link]
  • Myers Wolin is searching for a patent attorney with 3-5 years of experience and a degree in EE to work at their Morristown, NJ office. [Link]
  • Young Basile is seeking a patent attorney with 2+ years of experience and a degree in ME, EE, or CS to work in their Ann Arbor office. [Link]

Upcoming Events:

  • The Florida Bar 3rd Annual IP Law Symposium will be held on March 1-2 on Orlando. The IP Symposium will address recent developments and important issues in IP law, including: Perspectives on the America Invents Act, Copyright Law and the First Sale Doctrine, Third Party Liability in IP, Enforcing IP on the Internet, Latest Developments in Patent, Trademark, and Copyright Law, and Recent Developments at the TTAB. Guest speakers include; Anne Gilson LaLonde, Scott Bain, John Welch, and many others. [Link]
  • Section 101 Gatekeepers: Finding the Patentable Subject Matter Line in a Judicial Sandstorm, webinar will be hosted by AIPLA on March 7. The webinar will be presented by Professor Christopher Holman and attorney Robert H. Fischer. [Link]
  • LES (USA & Canada) 2012 Winter Meeting will be held March 12-14 in Anaheim, CA. The meeting will focus on cutting-edge issues in the high tech space with overlapping content in related industries, including clean tech, nanotech, and medical devices. Featured speakers include Honorable Randall Rader, Chief Judge, U.S. Court of Appeals for the Federal Circuit; Catherine Casserly, CEO, Creative Commons; and Patrick Ennis, Head of Global Technology, Intellectual Ventures. Patently-O readers save $100 with code PO1. [Link]
  • The New Jersey Intellectual Property Law Association will hold a half-day Patent Litigation Seminar on Wednesday, March 14, 2012 11:45 am to 5:45 pm. Guest speakers include: Paul Berghoff, Kara Stoll, William McElwain, Richard Bress, Barbara Fiacco, and Lewis Ho. [Link]
  • C5's 22 Forum on Biotech Patenting conference will take place March 14-15 in Munich, Germany. The conference brings together experienced in-house counsel from both innovator and generic pharma and biotech companies and their expert legal advisors from various jurisdictions across the globe. Session will cover the patentability of gene sequence patents in Europe and the US, current developments on biotech products and patent considerations for bio-deposits, and many other sessions. (Patently-O readers register with PO 10 for a discount). [Link]
  • American Conference Institute's FDA Boot Camp conference is scheduled for March 20-21 in New York, NY. ACI's FDA Boot Camp has been designed to give products or patent litigators, as well as patent prosecutors, industry in-house counsel, and life sciences investment and securities experts, a strong working knowledge of core FDA competencies. (Patently-O readers register with PO 200 for a discount). [Link]
  • American Conference Institute's PTO Procedures Under the America Invents Act conference is scheduled for March 26-27 in New York, NY. This conference will serve as a practical and tactical guide for PTO practice post-Patent Reform. (Patently-O readers register with PO 200 for a discount). [Link]
  • The ABA Section of IP Law will hold its 27th Annual IP Law Conference March 28-30 in Arlington, VA. The conference is recognized for its national and international scope and preeminent programming. It attracts IP practitioners from across the nation and around the world. Speakers and moderators include: Sharon Marsh, Keisha Hylton-Rodic, Alexander Wilson, Steven Emmert, Teresa Rea, James Bikoff, David Kappos, and many others. The discounted early registration deadline is March 14. [Link] [Link]
  • The IP Section of the Atlanta Bar Association and Georgia State University Law School will hold its 8th annual SpringPosium at the Barnsley Gardens resort on April 13 &14. Some example seminars will include: the new America Invents Act, Federal Court best practices, IP law and life practice management, and recent developments in damages law. Guest speakers include: Clerk of Court and Chief Deputy Clerk of the US Court of Appeals for the Federal Circuit, Jan Horbaly and Pamela Twiford and Clerk of Court of the US District Court for the North District of Georgia, James Hatten.
  • The European Generic Medicines Association is hosting the 10th EGA International Symposium regarding Biosimilar Medicines on April 19-20 in London. Greenblum & Bernstein is providing a pre-symposium workshop on April 19, 2012 titled: Biosimilars In America: IP Strategy and Due Diligence. The workshop will explore the mechanics of the Biologics Act with an emphasis on how the Act relates to the involved intellectual property and how the intellectual property may impact the biosimilar applicant's strategy for entering the market. [Link]
  • ACI will hold its 6th Annual Paragraph IV Disputes conference on April 24-25 in New York City. The conference will cover topics such as: the impact of the AIA on Hatch-Waxman litigation, claim construction, prior art obviousness and obvious-type double patenting, and many other topics. (Patently-O readers register with PO 200 for a discount). [Link]

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

Patently-O Bits & Bytes by Lawrence Higgins

Patent, ,

Conference on Industry/Academic Collaborations: Lessons from the Trenches

  • Innovation remains a major driver of economic growth in this country, and research universities provide a key reservoir of innovation. Increasingly, universities and industry have joined forces to translate that potential into jobs and commercial industries. Designing the complex legal and business frameworks for these collaborations is an evolving art, which will be discussed by those at the forefront of these transactions. On February 29, at UC Hastings College of Law, individuals from some of the biggest companies in the world will discuss their relationships with Universities. Google, Hoffman-LaRoche, Intel, Pfizer and BP will speak about their collaborations. The Keynote Speaker will be Chris Vein, The White House Office of Science and Technology Policy. Guest speakers include: Robin Feldman, Susan Capello, Paul Willems, Louisa Daniels, Jeff Walz, Laura Berner, and many others. This event will also be streamed online for individuals who are unable to attend. [Link]

Federal Court Dismisses OSGATA Lawsuit

  • The OSGATA suit against Monsanto has been dismissed by the US District Court for the Southern District of NY. OSGATA claimed that they did not want or intend to grow crops containing Monsanto patented gene traits and they feared being sued by Monsanto. Judge Naomi Buchwald noted that, Monsanto averages about 13 patent infringement lawsuits targeted towards farmers per year, which is considered insignificant compared to the number of farms in the US. The court held that there was no case or controversy because Monsanto has yet to take action against any of the plaintiffs. [Link]

USPTO Detroit Office Update

  • The Elijah J. McCoy United States Patent and Trademark Office (USPTO) will open in Detroit, Michigan in July 2012. The USPTO plans to hire for more than 100 positions, including patent examiners and Board of Patent Appeals and Interferences judges. The USPTO hopes to fill more than 50 percent of the positions by the end of the summer. Vacancy announcements for patent examiner positions and judges have been posted on the USA Jobs website.

Student Writing Contest

  • The Pennsylvania Bar Association IP Law Section is accepting papers for its annual IP writing contest. The competition is open to all students enrolled in one of the Pennsylvania law schools and Pennsylvania residents enrolled at other law schools within the US. The first place winner will receive $2500 and the paper will be published. [Link]

Patent Jobs:

  • Banner & Witcoff is seeking an International IP Manager with a minimum of 10 years of experience in management to work in their DC or Chicago office. [Link]
  • Axiom is looking to hire patent attorneys with 7+ years of experience to work remotely. [Link]
  • Sterne, Kessler, Goldstein & Fox is looking for electrical IP attorneys with 1-4 years of experience to work in their DC office. [Link]
  • Hiscock & Barclay is seeking patent attorneys/agents with a minimum of 3-5 years of experience to work at their Syracuse & Rochester offices. [Link]
  • The Coca-Cola Company is searching for a patent agent with 2-4 years of experience to work at their Atlanta location. [Link]
  • The USPTO is looking for patent examiners with a BS degree in engineering to work at their Alexandra location. [Link]
  • Steptoe & Johnson is seeking IP associates with a minimum of 4 years of experience in IP litigation to work in their DC office. [Link]
  • Fish & Richardson is looking for technical advisors with a background in EE, physics, or CS to work at one of their several offices. [Link]
  • Klemchuk Kubasta is searching for a patent associate with at least 4 years of experience to work in their Dallas office. [Link]
  • Guntin Meles & Gust is seeking patent attorneys with 3+ years of experience and a degree in EE or Computer Engineering to work in their Chicago office. [Link]
  • Levine Bagade Han is looking for a patent associate with 2-6 years of experience to work in their Palo Alto office. [Link]
  • Myers Wolin is searching for a patent attorney with 3-5 years of experience and a degree in EE to work at their Morristown, NJ office. [Link]
  • Young Basile is seeking a patent attorney with 2+ years of experience and a degree in ME, EE, or CS to work in their Ann Arbor office. [Link]

Upcoming Events:

  • The Florida Bar 3rd Annual IP Law Symposium will be held on March 1-2 on Orlando. The IP Symposium will address recent developments and important issues in IP law, including: Perspectives on the America Invents Act, Copyright Law and the First Sale Doctrine, Third Party Liability in IP, Enforcing IP on the Internet, Latest Developments in Patent, Trademark, and Copyright Law, and Recent Developments at the TTAB. Guest speakers include; Anne Gilson LaLonde, Scott Bain, John Welch, and many others. [Link]
  • Section 101 Gatekeepers: Finding the Patentable Subject Matter Line in a Judicial Sandstorm, webinar will be hosted by AIPLA on March 7. The webinar will be presented by Professor Christopher Holman and attorney Robert H. Fischer. [Link]
  • LES (USA & Canada) 2012 Winter Meeting will be held March 12-14 in Anaheim, CA. The meeting will focus on cutting-edge issues in the high tech space with overlapping content in related industries, including clean tech, nanotech, and medical devices. Featured speakers include Honorable Randall Rader, Chief Judge, U.S. Court of Appeals for the Federal Circuit; Catherine Casserly, CEO, Creative Commons; and Patrick Ennis, Head of Global Technology, Intellectual Ventures. Patently-O readers save $100 with code PO1. [Link]
  • The New Jersey Intellectual Property Law Association will hold a half-day Patent Litigation Seminar on Wednesday, March 14, 2012 11:45 am to 5:45 pm. Guest speakers include: Paul Berghoff, Kara Stoll, William McElwain, Richard Bress, Barbara Fiacco, and Lewis Ho. [Link]
  • C5's 22 Forum on Biotech Patenting conference will take place March 14-15 in Munich, Germany. The conference brings together experienced in-house counsel from both innovator and generic pharma and biotech companies and their expert legal advisors from various jurisdictions across the globe. Session will cover the patentability of gene sequence patents in Europe and the US, current developments on biotech products and patent considerations for bio-deposits, and many other sessions. (Patently-O readers register with PO 10 for a discount). [Link]
  • American Conference Institute's FDA Boot Camp conference is scheduled for March 20-21 in New York, NY. ACI's FDA Boot Camp has been designed to give products or patent litigators, as well as patent prosecutors, industry in-house counsel, and life sciences investment and securities experts, a strong working knowledge of core FDA competencies. (Patently-O readers register with PO 200 for a discount). [Link]
  • American Conference Institute's PTO Procedures Under the America Invents Act conference is scheduled for March 26-27 in New York, NY. This conference will serve as a practical and tactical guide for PTO practice post-Patent Reform. (Patently-O readers register with PO 200 for a discount). [Link]
  • The ABA Section of IP Law will hold its 27th Annual IP Law Conference March 28-30 in Arlington, VA. The conference is recognized for its national and international scope and preeminent programming. It attracts IP practitioners from across the nation and around the world. Speakers and moderators include: Sharon Marsh, Keisha Hylton-Rodic, Alexander Wilson, Steven Emmert, Teresa Rea, James Bikoff, David Kappos, and many others. The discounted early registration deadline is March 14. [Link] [Link]
  • The IP Section of the Atlanta Bar Association and Georgia State University Law School will hold its 8th annual SpringPosium at the Barnsley Gardens resort on April 13 &14. Some example seminars will include: the new America Invents Act, Federal Court best practices, IP law and life practice management, and recent developments in damages law. Guest speakers include: Clerk of Court and Chief Deputy Clerk of the US Court of Appeals for the Federal Circuit, Jan Horbaly and Pamela Twiford and Clerk of Court of the US District Court for the North District of Georgia, James Hatten.
  • The European Generic Medicines Association is hosting the 10th EGA International Symposium regarding Biosimilar Medicines on April 19-20 in London. Greenblum & Bernstein is providing a pre-symposium workshop on April 19, 2012 titled: Biosimilars In America: IP Strategy and Due Diligence. The workshop will explore the mechanics of the Biologics Act with an emphasis on how the Act relates to the involved intellectual property and how the intellectual property may impact the biosimilar applicant's strategy for entering the market. [Link]
  • ACI will hold its 6th Annual Paragraph IV Disputes conference on April 24-25 in New York City. The conference will cover topics such as: the impact of the AIA on Hatch-Waxman litigation, claim construction, prior art obviousness and obvious-type double patenting, and many other topics. (Patently-O readers register with PO 200 for a discount). [Link]

Contact Lawrence.Higgins@patentlyo.com with leads for future Bits and Bytes.

Mettler-Toledo v. B-Tek: Limiting Claim Elements to the Preferred Embodiment

Patent, , ,

By Jason Rantanen

Mettler-Toledo, Inc. v. B-Tek Scales, LLC (Fed. Cir. 2012) Download 11-1173-1200
Panel: Bryson, Moore (author), Reyna

547 patentIn my Introduction to Intellectual Property class this week we discussed the classic tension between (1) reading the claims in light of the specification and (2) not importing limitations from the specification into the claims.  In most instances the court attempts to strike a balance between these two canons (exemplified by Phillips).  When means-plus-function claims are involved, however, different rules apply – as this case illustrates.

At issue in Mettler-Toledo was technology for weighing objects, such as large commercial trucks. The first of Mettler's asserted patents, No. 4,815,547, describes an individual load cell; the second, No. 4,804,052, describes a system and method for correcting weight measurements based on the location of objects on a scale.  Following jury findings that the patents were not infringed and that the '052 patent would have been obvious, the district court denied Mettler's JMOL.  Mettler appealed.

On appeal, Mettler challenged a key construction of the '547 patent claims: that several of the means-plus-function terms require a multiple slope integrating A/D converter, and equivalents thereof, rather than any generic A/D converter.  Mettler contended that by limiting the claims in this way the district court erred by importing the structure of only the preferred embodiment into the claims. 

The CAFC rejected this argument.  "Our case law is clear that a means-plus-function claim limitation is limited to the structures disclosed in the specification and equivalents."  Slip Op. at 7.  Here, the patentee chose to disclose only a single embodiment; thus, the means-plus-function claim was necessarily limited to that embodiment.  "If a patentee chooses to disclose a single embodiment, then any means-plus-function claim limitation will be limited to the single disclosed structure and equivalents thereof."  Id.  Nor was a single reference to an "A/D converter" in the Abstract sufficient to compel a broader structural disclosure because it was not linked to any claimed function.

Obviousness: The CAFC also affirmed the district court's denial of JMOL of nonobviousness of the '052 patent.  Mettler's challenge was based on the argument that a prior art reference did not teach correcting for load position, an element of each claim of the '052.  The CAFC rejected this argument, first noting that the issue of what is disclosed by a prior art reference is a question of fact, then concluding that substantial evidence supported the jury's finding as to the teaching of the 'prior art reference. 

B-Tek's Cross Appeal for Sanctions: During the litigation B-Tek requested documents relating to Mettler's manufacturing capacity in order to rebut Mettler's lost profits damages claim.  Although Mettler stated that it had no such documents, during trial a Mettler employee admitted that certain documents existed (a production schedule and plant diagram).  Mettler further admitted that it provided some of these documents to its damages expert.  The district court denied B-Tek's motion for sanctions on the grounds that the possible existence of these documents had been disclosed during a deposition, these documents were of marginal relevance, and that B-Tek could not show any harm or prejudice given that it prevailed on the issue of infringement. 

On appeal, the CAFC concluded that the district court did not abuse its discretion in declining to sanction Mettler, correctly considering the relevance of the documents and the any harm to B-Tek.

Edited to clarify the first sentence. 

Federal Circuit Stays Relief Pending Appeal

Patent,

By Dennis Crouch

Sciele Pharma v. Lupin (Fed. Cir. 2012)

In a December 2011 order, the Delaware district court awarded preliminary injunctive relief to Sciele and Shionogi and forcing Lupin to stop selling generic versions of the patentee’s diabetes drug Fortamet (metformin). After an emergency motion, the district court refused to stay relief pending appeal. Based upon a separate emergency motion, the Court of Appeals for the Federal Circuit has now vacated the preliminary injunction and remanded the case for a new hearing.

Pre-hearing motions to the Federal Circuit are normally decided by a designated motions judge. Typically, the Federal Circuit judges rotate through that position on a monthly basis. Simple procedural motions are pushed-down to the clerk to handle. At times, more complex motions are pushed-up to the merits panel who will hear the substantive portion of the case. Motions for emergency stay of injunctive relief are typically in the latter category being pushed to the merits panel because judging the motion typically requires a substantive review of the merits of the appeal. In this case, Judges Lourie, Prost, and Moore decided the motion.

Under the Federal Rules of Civil Procedure, a losing party has a right to delay (stay) payment of monetary damages pending appeal of the decision. That right, however, does not extend to staying an order for injunctive relief. Thus, in those cases the losing party must file emergency motions for a stay pending appeal.

Along the lines of eBay, appellate courts apply a four factor test to determine whether to issue a stay of injunctive relief pending appeal. The party requesting the stay must show (1) a likelihood of success on the merits of the appeal; (2) that the requesting party will suffer irreparable injury absent a stay; (3) that the stay will not unduly harm other parties interested in the proceeding; and (4) that a stay serves the public interest. The Federal Circuit has held that either of the first two factors can be (and often are) dispositive. Namely, the court has held that the party can be awarded a stay based upon either (1) a strong likelihood of success on the merits of the appeal or (2) a substantial case on the merits coupled with harm factors that “militate in its favor.”

Here, the district court had rejected the defendant’s obviousness argument but did not make any proper finding of facts or conclusions of law regarding that argument. On appeal, the Federal Circuit held that the district court should have made “an independent assessment” of the obviousness defense and that failure prevents the Federal Circuit from “engaging in a meaningful review of the issue.” As such the court vacated and remanded “for a proper analysis.”

In the separate decision of Midtronics v. Aurora Performance (Fed. Cir. 2012), the Federal Circuit has also awarded an emergency stay of relief pending appeal. In the Midtronics case, Judge Shadur of the Northern District of Illinois ordered the adjudged infringer to issue a general recall of its battery testing devices and pay end users to return the infringing product. BPPower appealed and also requested an emergency stay of the order pending resolution of the appeal. Without substantive opinion, the same panel of Judges Lourie, Prost, and Moore issued a stay of relief pending the outcome of the appeal.

Ford Krippelz

Patent, , ,

By Dennis Crouch

Krippelz v. Ford (Fed. Cir. 2012)

This case involves an interesting 20+ year history between Mr. Krippelz and Ford Motor Company, including 14 years of litigation over a mirror lamp. Ford has won what appears to be the final round.

* * * * *

Back in 1991, Mr. Krippelz sent Ford Motor Company a copy of his patent covering a downward-facing side-mirror light and a license inquiry. Ford was not interested in a license, but in 1997 began selling cars with downward-facing side-mirror lights. Krippelz sued in 1998. A paper battle continued over the next decade and even after Mr. Krippelz death in 2010. During that time, the USPTO confirmed the patentability of the asserted claims in a reexamination, the judge awarded summary judgment of infringement, the jury the patent valid and awarded $23 million in damages; and the judge boosted that figure to $56 million based upon pre-judgment interest and enhanced damages for willful infringement.

On appeal, the Federal Circuit has reversed – finding the patent invalid as anticipated by a 1951 French Patent invented by Charles DuBois of the former French West African colonial territories.

A court may find issued patent claim invalid as anticipated only when presented with clear and convincing evidence that a single prior art reference discloses each and every element of a claimed invention.

The focus here was on the Krippelz patent’s claimed “conical beam of light” and whether that beam was disclosed by DuBois. In construing the claim, the district court held that the conical limitation required that “the filament of the light bulb is at or near the focal point of an optical reflector.” DuBois included a statement that his system may also include “a bulb at the focus of the reflector.” In reviewing the difference, the appellate panel found that any reasonable jury would find the asserted claim invalid based upon DuBois and that the district court had abused its discretion in denying the motion for Judgment as a Matter of Law.

Most appellants in Ford’s position would have appealed claim construction because of the lower standard of review. Here, Ford may have lost that right by not previously objecting to the claim construction. That said, the motor company was able to roll a hard eight to overcome the strong presumption of validity and the deference given to the jury determination.

The New Choice: Inequitable Conduct or Copyright Infringement

Patent, , ,

CopyrightSymbolMany patent applicants enjoy the fact that the USPTO lists all cited and considered references on the face of each patent. That listing provides an apparent presumption that the newly patented invention is a step beyond anything found in those references. Economists have even shown that patents with more cited references tend to be relatively more valuable. Patent applicants are also under a duty to submit prior art references that are material to patentability. 37 C.F.R. §1.56.

A negative side of citation is now emerging. Recently, copyright owners have begun trolling non-patent prior art citations to see whether any of their works were copied and submitted to the USPTO. Of course, following standard law firm practice additional copies were likely generated for the file and for review by the inventors or attorneys. These copies may be hard copes or electronic versions, but as MegaUploads can now attest, that makes no difference in copyright law. Statutory damages for copyright infringement range from $750 to $150,000 per work. The exact figure is largely within the discretion of the judge and is based upon what the "the court considers just" and whether the infringement was willful.

A number of scientific journals have begun to threaten law firms and their clients for submitting copies of journal articles to the USPTO.  The typical cease & desist letter that I've seen says something like the following:  

"We've been trolling through USPTO records and found that you submitted a copy of one of our articles articles to the USPTO and we suspect that you maintained other copies in your files and distributed additional copies within your organization. These actions constitute copyright infringement and are not fair use.  We will sue you unless you come into compliance with our CCC licensing scheme."

To be clear, the focus in the letter is on copies being submitted to the USPTO as well as copies retained in the file and distributed internally.

I looked-into the CCC automated licensing system and found that they offered the right to make copies of a NATURE article (one of the journals taking action) for $32 per copy. 

USPTO Response: In a surprisingly bold statement, the USPTO's General Counsel Bernie Knight released a statement late last week indicating the USPTO's belief that submission of unlicensed copies of copyrighted materials to the USPTO for the purpose of complying with Rule 56 cannot create copyright liability because that action is fair use under 17 U.S.C. 107.  This issue previously arose when the USPTO was building the PAIR electronic record system.  It was because of potential copyright concerns that the USPTO decided not to make available non-patent prior art through the PAIR system. However, the USPTO has offered its position that it is fair use for the agency to charge a fee to make and distribute paper copies of the copyrighted works (as part of the file history).

The USPTO took no position on whether applicant's creation of file-copies and internal distribution of copies also qualify for the fair use defense. In addition, applicants who have obtained limited licenses to works may be under a contractual duty to avoid making further copies even if those copies would have been fair use.

How much money?: On an annual basis, I would estimate that at least five hundred thousand journal articles are submitted to the USPTO for consideration.  Each submission probably results two local copies for the file & review by the attorney, inventors, and others in addition to the submitted copy.  That takes the annual licensing market to around $50 million.  Not a tremendous amount for a nationalmarket, but that may be enough to save the struggling scientific journal industry.

Fair Use: An interesting aspect of fair use analysis is that the outcome can change based upon market conditions and general custom.  Here, for instance, if it is very easy to obtain a license by simply paying a fee online and a number of patent applicants begin paying that fee regularly, an action that was once considered fair use may again fall under the copyright infringement umbrella. 

How will your firm respond? Should your engagement letter be amended? 

Celsis: Federal Circuit Upholds Preliminary Injunction over Dissent

Patent, , ,

by Dennis Crouch

Celsis In Vitro v. CellzDirect and Invitrogen (Fed. Cir. 2012)

This case is important because it provides an important incremental analysis of when a validity challenge is sufficiently substantial to lead a court to reject a motion for preliminary injunctive relief.

Majority opinion by Chief Judge Rader (author) and Judge Prost. Dissent by Senior Judge Gajarsa.

Celsis owns Patent No. 7,604,929 — claiming as its invention a method and system of freezing and preserving human liver cells using multi-cryopreservation.  In a split opinion, the Federal Circuit affirmed the lower court's preliminary injunction order stopping the defendants from practicing the invention. 

When appealed, a preliminary injunction is reviewed for abuse of discretion that requires clear error, either in “judgment in weighing relevant factors” or in the exercise of “discretion based upon an error of law.”  A decision on preliminary relief is immediately appealable. 

Dissent on Substantial Question of Obviousness: Writing in dissent, Judge Gajarsa argued that this case is not amenable to the “extraordinary and drastic remedy of a preliminary injunction” because the defendants “raised a substantial question as to the validity” of the asserted patent.  Focusing on the burden of proof, Judge Gajarsa noted that a preponderance of the evidence is sufficient to prove the “substantial question” and that “it is unnecessary to prove a substantial question of invalidity by clear and convincing evidence.”

The the key dispute between the majority and dissent was on the issue of obviousness.  Judge Gajarsa wrote:

In my judgment, the district court abused its discretion in finding that Celsis had demonstrated a likelihood of success on the merits because the claimed invention is nothing more than a repetition of steps already known in the art.  Moreover, the majority perpetuates this error, and in so doing applies the wrong standard for obviousness and rationalizes the issuance of the preliminary injunction because it would prevent competition with a patented process which may be proven to be invalid. 

In particular, Judge Gajarsa argued that the district court and majority improperly rejected the obviousness argument by seeking some teaching or suggestion (TSM) in the prior art that would lead someone to attempt to combine the known elements of the claimed invention.

In particular, the majority wrote that the key prior art does not disclose “micro-cryopreservation” as claimed nor does it suggest this step as a solution to problems known in the art.  Chief Judge Rader wrote “This court has not seen [the Defendants] identify any teaching, suggestion, or motivation in the [prior art] that multiple rounds of freezing would somehow increase rather than decrease cell viability.”  The majority agreed with the lower court that the obviousness argument lacked credibility because "not a single one of that astonishingly large body of literature was devoted to the subject of multi-cryopreservation of hepatocytes."  Judge Gajarsa felt this fact was inconsequential because multi-cryopreservation simply involved repeating steps that were already known.  

DDC Comment: The TSM test for combining prior art was eliminated by the Supreme Court KSR v Teleflex in much the same way that the MOT test for patentable subject matter was eliminated in Bilski. In both cases, the strict tests remain probative, if inconclusive, tools.  However, in the context of a preliminary injunction a defendant's failure to provide a motivation to combine prior art may well be sufficient find a patent “likely nonobvious.” 

Although identified as a “factor”, the likelihood of success factor turns out to be a necessary element of a successful motion for preliminary relief.  In other words, if the plaintiff is unable to prove that it has a sufficient likelihood of success on the merits of the case then the district court will deny the preliminary injunction motion.  This case provides some assistance in determining when that threshold has been met.

Motivation versus Long Felt Need:  Chief Judge Rader is known for playing logical games with the secondary indicators of nonobviousness. Here, the accused infringers provided evidence of a “market need” for the solution and argued that those market forces would prompt the variation found in the patent.  That argument follows the statement in KSR that “market forces can prompt variations” of known design elements.  Judge Rader flipped the argument and instead noted that such market need is when “properly linked to the claimed invention, is actually probative of long felt need under objective criteria analysis and supportive of non-obviousness.”

Preliminary Injunction Standards: A preliminary injunction is decided on a four-factor test that is almost identical to the test outlined for permanent injunctions in eBay v. MercExchange.  Namely, a court must consider (1) likelihood of success on the merits, (2) irreparable harm, (3) balance of hardships, and (4) public interest.  In the context of permanent relief, the likelihood of success on the merits is no longer a factor because permanent relief is only determined after the patentee wins on the merits. In eBay, the Supreme Court included an additional factor –  that monetary damages are insufficient.  However, that factor is likely wholly subsumed by the “irreparable harm” factor.

Here irreparable harm was shown by expert testimony and evidence of "price erosion, damage to ongoing customer relationships, loss of customer goodwill (e.g., when an effort is later made to restore the original price), and loss of business opportunities." And, the public interest factor is normally presumed to be met in patent cases because the public interest favors enforcement of valid patents.

Injunctive Relief and the Public Interest at the ITC

Patent,

by Dennis Crouch

The U.S. International Trade Commission is a branch of the U.S. government designed to protect and serve U.S. interests.  The ITC handles a variety of international trade issues, including passing judgment on whether importation of accused products constitutes actionable patent infringement. These Section 337 disputes have become more important as more expensive and high-technology products are being imported rather than being manufactured in the US and because of legal changes that have made injunctive relief relatively more likely in an ITC proceeding as compared with federal court litigation.

Although both the patentee and accused infringers have standing to argue their respective cases, ITC proceedings are administrative in nature with a focus on whether a domestic industry deserves protection.  Thus, rather than being captioned Apple v. HTC, the recent dispute between the two parties has the title: In the Matter of CERTAIN PERSONAL DATA AND MOBILE COMMUNICATIONS DEVICES AND RELATED SOFTWARE, 337-TA-710.

In its decision on the case, the Commission concluded that HTC’s Android phones violated Apple’s Patent No. 5,946,647 (Claims 1 and 8) and that the HTC phones do not infringe the asserted claims of Apple’s Patent Nos. 5,481,721, 6,275,983, or 6,343,263.  Commentators have noted that HTC should have little trouble designing around the the ‘647 patent. This is especially true because the Commission gave HTC four–months to alter its product before injoining further importation. 

In federal court litigation, a court can only award injunctive relief after considering teh four equitable factors outlined in eBay v. MercExchange. The ITC is not bound by eBay, but is required to consider the impact that an injunction (or “exclusion order”) would have on competition and consumers.  Interestingly, the ITC order follows a recent NYTimes editorial, by Professors Mark Lemley and Colleen Chien who argued for delay in exclusion orders in order to serve the public interest.

If the ITC continues to give more weight to the public interest factor, the result is that ITC exclusion orders may begin to parallel the injunction that a court would have ordered under eBay. Although the ITC still does not directly consider the first three eBay factors, it does require a domestic industry being harmed by the alleged importation.  That harm is often the type of harm that would help a patentee prove its case under eBay.

Notes:

  • The ITC does not have power to award damages. This could suggest that the ITC decisions automatically satisfy the first-two eBay factors.
  • In the Apple v. HTC case, the full decision on the merits that discusses the public interest factors has apparently been held as classified (or at least under seal).  The US President has the statutory right to disapprove of the decision within the next 60 days.
  • Claim 1 of the infringed ‘647 patent is the broadest of the infringed claims and is directed to a system of detecting structures in data and then performing some action on the structures. The claim reads as follows: 1. A computer-based system for detecting structures in data and performing actions on detected structures, comprising: an input device for receiving data; an output device for presenting the data; a memory storing information including program routines including an analyzer server for detecting structures in the data, and for linking actions to the detected structures; a user interface enabling the selection of a detected structure and a linked action; and an action processor for performing the selected action linked to the selected structure; and a processing unit coupled to the input device, the output device, and the memory for controlling the execution of the program routines.
  • These patents were all filed in the mid-1990’s and no, Steve Jobs is not listed as an inventor of any of them.

Time for Clients to Start Marking?

Patent,

Guest post by Paul Morgan

Recent patent legislation has removed almost all of the prior dangers of miss-marking products with patent numbers, including fully removing any risk of leaving expired patent numbers on products. (The new 35 U.S.C. § 292 is reproduced below). Yet the significant potential advantages for infringement damages recovery by marking products under 35 U.S.C. § 287, etc., remain. Patent owners who do not mark their products are prevented by §287 from recovering any damages for any of the infringements occurring prior to serving an actual, specific, notice of infringement, or bringing suit. (As a caveat, products that only “use” a patented process need not be marked under §287).

Also, marking can aid assertions of “willful” infringement – resulting in enhanced damages. Likewise, marking has the potential of aiding in establishing “inducing” infringement assertions.

Under the new statute, “virtual” marking can now be used which is easily maintained or changed and does not require product mold or tooling changes.

So, now is the time for client counseling on the reconsideration of patent marking policies by many companies. Especially those companies that had previously marked some of their products but had stopped due to the recent plague of costly mass-marking-trolls-litigation, now ended by the AIA.

Note: Of course deliberately or recklessly marking a product with a patent number that does not apply to any part of that product is still unwise. It can be potentially indirectly prejudicial for patent enforcement, FTC complaints, etc., even if competitors, or the government, cannot prove any actual damages occurred from that kind of deliberate miss-marking.

————–

35 U.S.C. 292

(a) Whoever, without the consent of the patentee, marks upon, or affixes to, or uses in advertising in connection with anything made, used, offered for sale, or sold by such person within the United States, or imported by the person into the United States, the name or any imitation of the name of the patentee, the patent number, or the words “patent,” “patentee,” or the like, with the intent of counterfeiting or imitating the mark of the patentee, or of deceiving the public and inducing them to believe that the thing was made, offered for sale, sold, or imported into the United States by or with the consent of the patentee; or Whoever marks upon, or affixes to, or uses in advertising in connection with any unpatented article the word “patent” or any word or number importing the same is patented, for the purpose of deceiving the public; or Whoever marks upon, or affixes to, or uses in advertising in connection with any article the words “patent applied for,” “patent pending,” or any word importing that an application for patent has been made, when no application for patent has been made, or if made, is not pending, for the purpose of deceiving the public – Shall be fined not more than $500 for every such offense. Only the United States may sue for the penalty authorized by this subsection.

(b) A person who has suffered a competitive injury as a result of a violation of this section may file a civil action in a district court of the United States for recovery of damages adequate to compensate for the injury.

(c) The marking of a product, in a manner described in subsection (a), with matter relating to a patent that covered that product but has expired is not a violation of this section.

Federal Circuit Ducks Question of Federal Mediation Privilege

Patent,

By Dennis Crouch

Kimberly-Clark Worldwide v. First-Quality Baby Products (Fed. Cir. 2011)

Diapers have been the subject of numerous patents and patent infringement lawsuits. In this case, K-C is suing its competitor, First Quality, for infringing more than a dozen diaper related patents.

The issue on appeal, however, focuses on a procedural matter: Whether K-C can be compelled to disclose information relating to prior alternative dispute resolution (ADR) proceedings between K-C and a different competitor, Proctor & Gamble. K-C argues that those ADR proceedings are privileged and therefore not discoverable.

The prior-ADR agreement between K-C and P&G were termed the ADR process a “non-binding arbitration.” In that process, both parties presented evidence to an agreed-upon neutral arbitrator who made a determination on the case. The loser of the arbitration was required to pay for cost of the arbitration. However, either party could reject the arbitrator’s decision and, if desired, file a district court lawsuit to resolve the dispute de novo. The agreement also included a provision that, if infringement was found, the losing party could avoid any damages at all by stopping the problematic activity within six months.

The Federal Rules of Evidence do not explicitly protect ADR proceedings except that Rule 408 prohibits a party from using certain compromises or “statements made in compromise negotiations” for the purposes of proving liability, invalidity of a claim, damages, or for impeachment of a witness. FRE 408. In addition, Rule 501 permits courts to apply “principles of the common law . . . in the light of reason and experience” in determining what additional information may be considered privileged.

Federal Mediation Privilege: Under the permission of Rule 501, the Pennsylvania District Court in this case followed other federal courts in adopting a “federal mediation privilege” that would privilege information and conduct associated with a mediated settlement process. Up to now, no federal court of appeals have recognized the privilege and, on appeal, the Federal Circuit refused to decide this issue. The appellate court wrote “we decline to determine if, in light of reason and experience, we should recognize a mediation privilege.”

What is a Mediation?: After agreeing that there is indeed a federal mediation privilege, the district court determined that the out-of-court resolution proceeding here did not count as a mediation but was rather an arbitration. As an arbitration, the prior proceedings did not qualify for the privilege. On appeal, the Federal Circuit affirmed – finding that the district court did not abuse its discretion in determining that the non-binding arbitration is not a mediation.

Privileging settlement discussions and mediations has two primary goals: (1) to encourage parties to settle disputes outside of court; and (2) to encourage a frank and candid discussion of the case in the settlement process. If statements from the mediation could later be used in court, parties would be likely to either refuse to participate or merely use the process to puff-up their position. In this case the neutral was charged with making a decision on the merits – i.e., the arbitration setup did not encourage a frank and candid discussion of the case. It is this difference that leads courts away from extending the mediation privilege to the arbitration context.

Affirmed

Notes:

  • I thought that the oral arguments by Connie Trela (Sidley) and Michael Underhill (Boies Schiller) were particularly good. It may have been because oral arguments were held while the court was in Oregon sitting before a packed-house of IP attorneys.
  • Although information regarding the prior arbitration is now discoverable, it will likely be disclosed only under seal – keeping it from the public purview.
  • In a separate case between these same parties, Kimberly-Clark has filed a petition for a writ of certiorari to the Supreme Court asking the court to review the Federal Circuit’s “patent specific standard” for determining whether to grant preliminary injunction. The Federal Circuit recently denied en banc rehearing of the issue over dissents from judges Newman, O’Malley and Reyna. [En Banc Denial][Supreme Court Petition]

Therasense: Encouraging Intentional Deception?

Dissent, Inequitable Conduct, Patent, Patent Cases 2011, , ,

Patent2011053Powell v. Home Depot (Fed. Cir. 2011).

Michael Powell’s invention is fairly simple –  it covers a guard for a circular saw on an arm.  In 2004, Mr. Powell developed the guard and provided several prototypes to Home Depot for the company to use in its in-store saws for cutting raw lumber to customer specifications.  Rather than having Powell manufacture the guards, Home Depot turned to another company for its 2,000 stores.  Powell obtained a patent then sued Home Depot.  After a three-week trial, a Florida jury awarded Powell $15 million in damages.  The district court also awarded enhanced damages, attorney fees, and pre-judgment interest — bringing the total to $24 million.

On appeal, the Federal Circuit affirmed claim construction, infringement, willfulness, inequitable conduct, and damages. Dissenting-in-part, Judge Dyk argued only that the finding of willful infringement was incorrect because Powell did not prove that Home Depot’s non-infringement defense was objectively unreasonable as is required under the objective prong of the willfulness inquiry.

Inequitable Conduct: One interesting element of the appeal involved inequitable conduct.  During prosecution, Powell had filed a Petition to Make Special on grounds that he was obligated to manufacture and supply devices embodying the claims sought. MPEP 708.02.  That original petition was roughly correct based upon ongoing manufacturing negotiations with Home Depot. Although negotiations with Home Depot fell-through before the PTO granted the petition, Powell never informed the PTO that he no longer qualified for the Special designation under the prospective manufacture prong and actively encouraged the PTO to decide the petition.

In a pre-Therasense decision, the district court held that the failure to inform the  PTO was done with intent to deceive the PTO, but that the intentional omission was not material because (1) the timing was not related to patentability and (2) Powell could have instead filed a petition to make special based upon ongoing infringement of the applied-for claims.  Under Therasense, inequitable conduct will not normally be found based upon an applicant’s improper omission unless the omission is the but-for cause of the patent being issued.

On appeal, the Federal Circuit affirmed — holding that:

Where, as here, the patent applicant fails to update the record to inform the PTO that the circumstances which support a Petition to Make Special no longer exist—that conduct does not constitute inequitable conduct. That is so because Mr. Powell’s conduct obviously fails the but-for materiality standard [of Therasense] and is not the type of unequivocal act, “such as the filing of an unmistakably false affidavit,” that would rise to the level of “affirmative egregious misconduct. Id.

This case creates further difficulty for patent attorneys by giving a free-pass to patent applicants who intentionally deceive the PTO in order to benefit their case.  Although participating in such activity violates the rules of conduct for patent law professionals under 37 C.F.R. 10.22, patent owners apparently will not face consequences.  Adding to the incentive for bad behaviour is the PTO’s lax enforcement through the Office of Enrollment and Discipline; the new statute of limitations on attorney misconduct charges; and the new supplemental examination procedures that allows patentees to whitewash patents obtained through inequitable conduct.  For some this may not be intuitive, but the primary solution is not increased enforcement but instead for the PTO to avoid relying upon attorney statements.

Senate Confirms Evan Wallach as Next Federal Circuit Judge

Bits and Bytes, CAFC, Patent

In a unanimous vote, the Senate has confirmed President Obama’s nomination of Judge Evan Wallach as Circuit Judge on the Court of Appeals for the Federal Circuit. In the mid-1990’s Wallach was appointed by President Clinton as an Article III judge on the U.S. Court of International Trade (CIT) – handling disputes regarding import transactions and federal statutes affecting international trade. Although the court has limited subject matter jurisdiction, the CIT otherwise has general legal and equitable powers. Judge Wallach is already familiar with Federal Circuit judges and Federal Circuit practice because CIT decisions are appealed to the Federal Circuit. In addition to his work in international trade, Judge Wallach is recognized as a leading expert on the international law of war. During a decade of private practice, Wallach represented business and media interests at the Las Vegas firm of Lionel Sawyer. He is a Vietnam War veteran (army) and later served as a Judge Advocate General. In the 1980’s Wallach also served as counsel for Senator Harry Reid. He holds degrees from Arizona (Journalism), Berkeley (JD), and Cambridge (LLB).

While Judge Wallach does not have extensive experience handling patent law issues. He did preside over a two-week patent infringement jury trial in Nevada. Mikohn Gaming Corp. v. Acres Gaming Inc., No. CV-S-97-1383 (D. Nev. Aug. 2, 2001).  In that case, the jury found the patent infringed and awarded $1.5 million in damages.

In his responses to questions from the Senate, Judge Wallach indicated his view that the “most important attribute of a judge” is: “Commitment to fundamental rule of law principles, including predictability, uniformity, transparency, neutrality and stare decisis.”

Limiting Damages: $107 Million Interest Charge Improperly Awarded On-Top of Pre-Agreed Damages

Damages, License, Patent, Patent Cases 2011,

By Dennis Crouch

Sanofi-Aventis v. Apotex (Fed. Cir. 2011)

The case focuses on Sanofi’s patent covering clopidrogrel bisulfate tablets sold under the trade name Plavix. ($4.5 billion in annual sales). In 2001, the generic drug manufacturer Apotex filed an abbreviated new drug application (ANDA) with the FDA – requesting that it be allowed to manufacture a generic version on the drug and alleging that Sanofi’s patent was invalid. Sanofi sued for infringement.

Pre-Judgment Agreement to Limit Damages: May 2006, the parties came to a limited agreement that any actual damages for infringement would be limited to “50% of Apotex’s net sales.” The agreement stated that:

If the litigation results in a judgment that the ‘265 patent is not invalid or unenforceable, Sanofi agrees that its actual damages for any past infringement by Apotex, up to the date on which Apotex is enjoined, will be 50% of Apotex’s net sales of clopidogrel products . . . . Sanofi further agrees that it will not seek increased damages under 35 U.S.C. § 284.

Apotex subsequently began marking its generic product before being stopped a few weeks later by a preliminary injunction. After Sanofi won the infringement trial, the judge set damages for that infringement at 50% of net sales plus interest. In dollar figures, damages were $442 million and the interest charge was $107 million. The district court had agreed that it should be bound by the prior agreement between the parties, but held that the agreement only limited damages and did not limit interest.

Contract Specification: Of course the contract could have spelled-out whether the limitation applied to interest charges, and the parties most certainly considered that issue during negotiations. But, for whatever, reason, they chose not to specify in the contract whether interest charges should be limited. Thus, the court was forced to consider the proper default rule for this situation.

At the Federal Circuit, Apotex argues that the interest payment should be included as part of the damage award and that the judgment therefore exceeds the agreed upon 50% damage limitation. In a 2-1 decision, the Federal Circuit has sided with Apotex – holding that the phrase “actual damages” as used in the contract “include[s] all damages necessary to compensate Sanofi for Apotex’s infringement.”

Because prejudgment interest is a form of compensatory damages, the district court erred by awarding additional prejudgment interest pursuant to 35 U.S.C. § 284.

In the majority opinion, Judge Moore relied both on the contractual language and on the history of compensatory damages that traditionally include both a reasonable royalty calculated at the point of infringement and interests charges for the delay in payment. Both of those elements are part of the “actual damages” calculation necessary to fully compensate the patent holder for past infringement. This follows the view espoused by the Supreme Court in its 1983 case involving General Motors where the court wrote:

An award of interest from the time that the royalty payments would have been received merely serves to make the patent owner whole, since his damages consist not only of the value of the royalty payments but also of the forgone use of the money between the time of infringement and the date of judgment.

Gen. Motors Corp. v. Devex Corp., 461 U.S. 648, 655 (1983).

Patent Act Damages: As usual, the language of the Patent Act is somewhat ambiguous on the meaning of damages. The first paragraph of Section 284 calls for an award of “damages adequate to compensate for the infringement but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court.” One view of this provision would require damages to be, at a minimum, a combination of a reasonable royalty plus interests and costs. In my view, however, the better plain meaning interpretation of Section 284 is that a court is required to award damages (minimum of reasonable royalty) and in addition must award interest and costs.

The appellate panel rejected the parties’ analysis of the language of the patent act as irrelevant – holding instead that “actual damages” was a contract term and that the interpretation therefore does not depend upon any statutory language.

While interesting, these arguments neither illuminate nor resolve the issue before us – the meaning of “actual damages” in the May 2006 agreement. The agreed upon “actual damages” are a creature of contract and not of the Patent Act. By entering into the May 2006 agreement, the parties decided that the agreement itself – not § 271(e)(4)(C) or § 284 – would govern the appropriate measure of damages from Apotex’s infringement.

Writing in Dissent, Judge Newman would have applied the usual background rule that interest is different from damages as a primary driving factor in interpreting the contract. In that framework, the contractual limitation on damages would not apply to limit interest as well.

My colleagues err in reading the contract’s silence on interest for infringement as meaning that the parties intended and agreed to forgo the interest to which the patentee is entitled by statute and precedent. I must, respectfully, dissent

c

Guest Post: Industrial Designs – the Wonder Weapon for the German Blitzkrieg?

Design Patent, Guest Post, Patent

PatLit is part of a family of excellent IPKat blogs created by UK attorney Jeremy Phillips. As you might guess, the website has a European focus, although not exclusively so. In a recent post, Michael Thesen wrote about the ongoing patent litigation between Samsung and Apple – with a focus on a German preliminary injunction based upon a European Design Registration. The following is reproduced with permission.

* * *

IgunA preliminary injunction granted on the request of Apple for preventing the sales of Samsung's Galaxy Pad in most of Germany has recently caused a fairly big swivet in the IP community. This 1st instance case, featuring an industrial design and a defendant citing somewhat flimsy evidence, has even found its way to the hall of fame of "patent wars" in minimum time.

What is surprising from a patent litigator's point of view is how simple this is. How is it possible that a preliminary injunction is granted based on an unexamined right? [DDC Note: Unlike US Design Patents, Europe Design Rights are registered without substantive examination.] 

As everywhere, the decision to grant a preliminary injunction requires a careful balancing of the right owner's interest in preventing damages of irreparable nature and the defendant's interest in a fair procedure. For any kind of protective right, doubts in the validity and doubts in the question of infringement will lead to a refusing decision in order to safely avoid erroneous judgments due to precipitate action. 

In patent matters, even a successfully completed examination procedure is not necessarily sufficient to prove the enforceability with a sufficient degree of certainty (at least in Germany). Rather, additional conditions have to be met. In the case of unexamined utility models, the burden of substantiating the enforceability is at the plaintiff's side, which must produce at least the results of a professional search carried out on the subject-matter of the utility model or a positive decision of an invalidity procedure.

Nothing of this kind can be found in the judgment of the Düsseldorf court – the reason being fairly simple: the validity is legally presumed in Art. 85(1) of the Community Design Regulation (CDR), i.e. the court has to treat the community design as valid. This legal presumption may be challenged by way of a counterclaim. However, this shifts the burden of proof/substantiation to the defendant's side. The applicability of Art. 85(1) CDR to interim relief has been questioned, but is generally accepted as far as the author of this note knows.

In practice, the short time scale of procedures in interim relief, the lack of search possibilities comparable to those available for patents and utility models and an official search result to start with leaves the defendant defenseless. This has a further crucial effect on the question of infringement because the defendant has practically no possibility to substantiate the existing design corpus such that the judge has to presume a high degree of freedom of the designer and thus a large scope of protection (cf. Art 10(2) CDR).

Further, the Hagen District court holds that the damages caused by infringements of industrial designs are more likely to be of irreparable nature as compared to patents because the industrial value of the former lies primarily in its individual character, which would be "diluted" when admitting counterfeits during the procedure of the merits, whereas the value of the patent basically lies in its technical advantages which are, as such, not affected by counterfeits on the market.

In particular in the world of telecommunication patent wars there is one further feature of industrial designs which makes them frightening weapons: they are not essential for standards and, thus, not subject to FRAND agreements. As a matter of course, there is no way to obtain interim relief against a global competitor on the basis of a standard-relevant patent. 

In other words, you need not bother with being fair, reasonable and non-discriminative when using industrial designs.

The result is that industrial designs are tools which are largely underestimated in the portfolio of most of the IP right holders. Design rights are not expensive, powerful, can be enforced rapidly, easy to understand even for less experienced judges or customs officers, not susceptible for translation errors even in China, and deserve a decent fraction of every company's IP budget.

The original post can be found here: http://patlit.blogspot.com/2011/10/industrial-designs-wonder-weapon-for.html.